Approach- corp just to tell the client what the law says, can we do this within the bounds

of the
law, interpret the law in the most reasonable way. Advice should be supported by the law.
Always google the client!!!

Client is Wobin, from Credit Suisse, pirated by UBS (one of the biggest banks in the world), now
referral for private manual referred to VDG, adopted the CS by Wobin. Private banking, and
investment manual- but only banking, question is the offshore bank (UBS) can do this in the PH
via remote communication, or by going here in the Philippines.

Offshore entity, wants to do contacting prospect via email or cold call, or people go to the PH
and just do this activity? #1, branch (through the parent) license in RCC income via branch profit
remittance, or subsidiary (separate, parent only owns the subsidiary, liability is only up to the
amount invested, revenue is dividend)
If you have branch, mas kaya gumawa in the PH, example UBS in SG and people in PH can
merge, strictly UBS SG should be doing all operations in PH, so if papadala ng tao, should be
employed in the PH (technically this is not allowed); subsidiary cannot be done due to separate
j.personality, if PH operations through the subsidiary cannot merge.

RJ: we just discuss the first set, items 1.1-.3 supplementary instructions and product
alignment rule, annex to guide the employee (checklist), and CAG, CDIF (reverse inquiry)
Review and update 
1.1         Supplementary Instructions the Philippines (SI Philippines) (attached).
The explanatory notes for the activities can be found in the Products Description
listattached. Note that potential tax implications related to activities conducted in the
Philippines will be assessed separately. Please limit your assessment to legal/regulatory
aspects.
1.2         Product Alignment Rules for the Philippines (PAR Philippines) (attached)
The purpose of these PAR rules it to highlight if there are nonetheless restrictions to
offering certain products or services to clients in the Philippines where the rules in the SI
have been complied with (i.e. permitted under the SIs).  Please see section 1
"Introduction" of the PAR.  In particular, please confirm:
a. if it is possible for Philippines domiciled clients to invest in Non-Deliverable Forward
(NDF) products with Philippines Peso underlying, either in their individual name or
through an offshore Personal Investment Company (PIC) with a beneficial owner
domiciled in the Philippines;
b. that adherence to the SI Philippines mitigates the need for an extensive PAR. The
understanding being that provided that services are offered on a reverse enquiry basis
from offshore and any product material sent into the Philippines contains an
appropriate disclaimer, UBS will not be deemed to be making an offer into the
Philippines.
1.3         Corporate Finance Advisory Services for the Philippines (CAG SI Philippines) (attached)
You will note that the first part of these rules repeat the first part of the SI.  Explanatory
notes to the activities are attached). Note that potential tax implications related to
activities conducted in the Philippines will be assessed separately. Please limit your
assessment to legal/regulatory aspects.
 Supplementary Instructions (SI) Philippines (+ Product Description of SI activities*)
  Client Declaration Instruction Form (CDIF) – Reverse Enquiry Form.
 Product Alignment Rules (PAR) Philippines
 Corporate Finance Advisory Services Philippines (+ Corporate Finance Advisory Service
Description*)
 Foreign Exchange Controls Questionnaire

- under FIA, memo, read know what to flag, one of them is solicitation of contracts in the PH so
even if remote communication trying to contact in PH doing business, the question is what if
customer ang tumawag sakin? And im not soliciting business, I just gave the materials (reverse
solicitation) mitigant only but not proof purpose of the CDIF.

1. “Doing business”
2. Go through the entire document SIP – check who is doing the business maybe branch or the
subsidiary
3. if there are updates 2018- 2020- check SEC resolutions on doing business rules
4. consistent advice with credit Suisse- check the credit Suisse advice manual banking, it has
same provision with SI which can cover the SI. UBS uses remote communication and travel so
just check.

Log .6

SI- private banking- ikaw nag open ka ng account sa banks; global wealth management- trust
functions (FOCUS)
1.
2. Review of CDIF
3. send July 24. And July 27. And call to discuss, July 28. Send 31. Then another call on 4 th.

Investment banking side- when the bank acts as financial advisor in particular deals, example
LRT is being bought by sumitomo, there is financial advisor na bank, bank provide advices,
creation of data rooms.
General Principles For Cross-border Activities
 
Provision of financial services and sale and marketing of financial products by a foreign
corporation on a cross-border basis, including the activities related thereto, will not
generally trigger licensing requirements from the Philippine authorities unless such acts
constitute “doing business” in the Philippines (please see below). This is because
Philippine laws and regulations have no extraterritorial effect and do not purport to govern
or regulate activities that are conducted offshore (i.e., outside of the Philippines).  A foreign
corporation doing business in the Philippines is required to obtain a primary license to do
business from the Philippine Securities and Exchange Commission (“SEC”).
 
In addition to the primary license, the foreign corporation may also be required to secure
secondary licenses from other government authorities depending on the type of business it
will engage in.  For example, authorization from the Bangko Sentral ng Pilipinas (“BSP”),
the Philippine central monetary authority, is required before any entity can engage in
banking or quasi-banking activities.  A license from the SEC is required before a corporation
can engage in the business of a securities broker or dealer.
 
“Doing business” in the Philippines
 
The SEC has issued several opinions and the Supreme Court has rendered numerous
decisions indicating that a foreign corporation is deemed not “doing business” in the
Philippines when its onshore commercial dealing is limited to a single or isolated transaction
and indicates no elements of continuity of conduct in that respect. The Supreme Court has
moreover held that an essential condition to be considered as “doing business” in the
Philippines is the actual performance of specific commercial acts within the country’s
territory.
 
We wish to note, however, that the SEC has recently issued SEC-OGC Opinion No. 17-03
dated April 4, 2017, stating that a foreign corporation is doing business in the Philippines on
the basis that there is sufficient “minimum contacts” between the foreign corporation and
the Philippines, including the fact that the corporation deals with Philippine clients,
notwithstanding that there was no finding that it performed any commercial acts within the
territory.
 
While an SEC opinion is non-binding and it cannot overturn the pronouncement of the
Supreme Court that a foreign corporation cannot be deemed to be doing business here
unless there are specific commercial acts conducted within this jurisdiction, Opinion No. 17-
03 gives one a sense of how the SEC may treat the activities of foreign corporations dealing
with Philippine clients even if these were done on a cross-border basis.
 
Appropriate sanctions will apply to a foreign corporation (including a foreign bank) “doing
business” in the Philippines without a license, including not being able to maintain or
intervene in any action suit or proceeding in any court or administrative agency of the
Philippines. However, such corporation may be still sued or proceeded against before the
Philippine courts or administrative tribunals on any valid cause of action recognized under
Philippine laws.
 
Reverse Solicitation
 
While there are no regulations defining or otherwise recognizing the concept of reverse
inquiry or reverse solicitation, contacts with Philippine prospects/clients done on a reverse
inquiry basis may mitigate (but not necessarily eliminate) the risk that a foreign corporation
will be deemed doing business in the Philippines.  Solicitation of business within the
Philippines is not the only basis for considering a foreign corporation as doing business
here.  Even if the transaction or contact with a Philippine client was initiated through
reverse solicitation, if the foreign corporation pursued its marketing efforts and initiated
further dealings with the client, it would still be considered doing business here.
 
Employee visits in the Philippines
 
While an employee or personnel of a foreign corporation can visit clients or potential clients
in the Philippines, the following additional risk mitigants should be complied with:
 
1. the visit should not be for the purpose of marketing or offering products or services
or providing any service (e.g., providing a service in connection with an existing
mandate);
2. the employee should not in any case stay in the Philippines for longer than a
cumulative period of 180 days a year;
3. the employee must be sensitive to what constitutes “doing business” and should be
conservative regarding the number of prospects/clients that he/she will visit in the
Philippines; and
4. the employee should inform the prospect/client that he/she is not authorized to
accept and perfect orders for execution and that the act of receiving is not an
acceptance of the instructions for legal purposes.
 
However, notwithstanding the application of the foregoing measures, a local court or
regulator might take the view that all such visits, when taken together, “imply continuity of
commercial dealings or arrangements aimed  at a commercial gain or the pursuit of the
purpose and object of the business organization,” which constitutes doing business in the
Philippines.
 
Marketing related information (including Internet requirements)
 
Marketing-related information can be provided from offshore (including through the
internet), but the material as well as online platforms should not be directed solely to
prospects/clients in the Philippines (e.g., not in Filipino language and not using the internet
top level domain “.ph”). The internet servers should be located outside the Philippines (but
note that in Opinion No. 17-03, the SEC still considered the foreign corporation as doing
business in the Philippines despite its servers being located outside of the Philippines).
 
Public Offering of Securities
 
Under the Securities Regulations Code (Republic Act No. 8799), securities cannot be sold or
offered for sale or distribution within the Philippines, without a registration statement duly
filed with and approved by the SEC.
 
However, the registration requirement does not apply to: (i) exempt securities, and (ii) the
sale of securities in an exempt transaction, which include offering of securities to not more
than 19 non-institutional lenders (i.e., private placement) within a 12-month period or to
qualified buyers.